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Why consult with a South Carolina trademark lawyer?
This brief guide will explore the legal frameworks surrounding trade names, trademarks, service marks, and trade dress under South Carolina law and federal law. Each type of intellectual property has unique legal protections, and understanding the distinctions is crucial for businesses seeking to protect their brand and identity. The guide includes detailed explanations, relevant statutes, registration processes, and enforcement mechanisms.
Prior to using any trademark, perform due diligence to ensure the business does not infringe on the marks of others. Such due diligence might include:
Online searches
Review of relevant trade and industry journals
Employing a law firm or trademark search firm or service
Employing a trademark watch service or purchase trademark infringement protection software to ensure against others infringing on your trademarks
Making sure that you own your own logo. Many businesses hire others to create logos to identify the businesses goods and services. Logos that are graphic designs are generally protected by copyright law. Unless the person who created it is you or your employee, you may not actually own the design. Where appropriate, a written work for hire agreement signed by everyone who will participate in the creation of a logo must be signed before any work begins. Otherwise, you may need to obtain a copyright assignment after the fact transferring their copyright in the design to you, including the right to use it as your trademark.
Trademarks and service marks permit consumers to identify the source of goods or services. The purpose of trademark law is to ensure that consumers are able to rely on marks in exercising their purchasing preferences by prohibiting competitors from using marks in a way that confuses consumers. Ensuring that trademarks accurately identify the source of goods or services benefits businesses by helping them create and protect business good will. Use of trademarks and service marks are subject to common law (unfair trade practices), state statutory law, and federal law (the Lanham Act).
To receive recognition and protection as a mark, a business must ensure that the mark (1) is distinctive and not generic, (2) is used in the ordinary course of trade—not merely in a nominal or token manner, and (3) is used in close and regular connection with the relevant goods or services.
Trademark law categorizes marks based on their level of distinctiveness. At the top of the hierarchy are arbitrary and fanciful marks. Businesses create arbitrary marks by applying common words in an unrelated context—such as Blue Diamond® for peanuts or Green Leaf® for insurance. They invent fanciful marks entirely, as seen with Exxon® and Xerox®. Suggestive marks—like Best Buy®, Greyhound®, Coppertone® (for suntan oil), and Roach Motel® (for insect traps)—imply a quality or feature of the product and are also considered inherently distinctive.
Lower on the scale are descriptive marks, such as The Real Yellow Pages®, and surname marks, like Edward Jones® or Charles Schwab®. Because these marks describe the product or use common names, courts do not consider them inherently distinctive. Businesses can only protect these marks if they establish that the public associates them with a specific source—a concept known as secondary meaning.
Secondary meaning is attained when, due to exposure to the mark in the market place, the relevant consuming public views the mark not in its primary, descriptive or surname sense, but as an indication of the source of the product or service. Generic marks (Carolina Bagel Bakery & Cafe) are incapable of becoming distinctive and cannot have ownership rights to them, nor can marks that are scandalous or immoral, or deceptive.
Trademark users have certain protections under common law principles of unfair trade practices. Under common law, the first user of a mark is the owner of it. However, if a second party later uses a confusingly similar mark in a remote geographic area in good faith (with no notice of the earlier use of the other mark that is ongoing in the U.S.) the second party will have superior rights in the mark in that remote geographical area (known as a ‘”good faith defense”).
The area of a party’s actual use of a mark is comprised not just of the area in which the user has sold goods or services through use of the mark. It may also include those areas in which there have been no sales but the mark has a presence by virtue of advertising or general reputation. Common Law Symbols. May use “TM” and “SM” to put world on notice of use of a non-federally registered mark.
Businesses can often satisfy the interstate commerce requirement through out-of-state sales, transactions involving customers engaged in interstate travel, the use of shipping services with hubs outside South Carolina, or by accepting credit card payments.
Registration on the Principle Register of the United States Patent and Trade Mark Office (USPTO). Registration on the Principle Register of the USPTO provides: (1) a right to assistance from U.S. Customs in preventing infringing goods from entering the country; (2) presumptions of mark ownership and validity and, after five years of registration, preclusion of certain challenges or defenses to the
mark; and (3) rights in the mark in a greater geographical area than would be possible under common law.
Be sure to make all periodic filings with the USPTO in the U.S. or elsewhere, as appropriate, or employ an experienced trademark lawyer to do so.
On the state-level, registration is generally done with the applicable Secretary of State. Protection is generally limited to the State. Not all Secretary of State offices perform any due diligence to determine whether use of the official name of the business is infringing on the trademark or service mark of others. Nor do applicable Secretary of State Offices generally perform a search against federal or other state registered marks upon when processing applications. Due diligence is generally left to the applicant to perform.
Businesses can often satisfy the interstate commerce requirement through out-of-state sales, transactions involving customers engaged in interstate travel, the use of shipping services with hubs outside South Carolina, or by accepting credit card payments.
Registration on the Principle Register of the United States Patent and Trade Mark Office (USPTO). Registration on the Principle Register of the USPTO provides: (1) a right to assistance from U.S. Customs in preventing infringing goods from entering the country; (2) presumptions of mark ownership and validity and, after five years of registration, preclusion of certain challenges or defenses to the
mark; and (3) rights in the mark in a greater geographical area than would be possible under common law.
Be sure to make all periodic filings with the USPTO in the U.S. or elsewhere, as appropriate, or employ an appropriately equipped law firm to do so.
Alternatively, a person may file an application alleging a bona fide intention to use the mark in trade and interstate commerce. The USPTO will make an initial examination of the applications and publish it for opposition. If there is no successful opposition, the applicant will have six months, renewable up to two-and-a-half years, to make the necessary use in trade and commerce and file a statement of use with the USPTO. After the statement of use is filed, the mark can be registered and a certificate of registration can be issued.
Marks registered on the federal level are indicated by the ® symbol.
A person who has already satisfied the threshold requirements of distinctiveness, use in trade, close and regular connection with the good or service, and used in interstate commerce may file an application with the USPTO. The USPTO will examine the applications and publish it for opposition. If there is no successful opposition, the USPTO will register the mark and issue a certificate of registration.
Federal law allows businesses to protect trade dress—such as a product’s shape, a distinctive and colorful background design on the product or its packaging, or even the unique design and décor of a retail chain or franchise—as a mark, if the trade dress creates a separate commercial impression and can identify or distinguish the product in the marketplace.
Under the Trademark Dilution Act of 1995, which became law in 1996, the owner of a “famous” trademark can now stop someone from using its trademark if it tends to weaken, blur or tarnish the famous mark. Unlike traditional trademark law, which still applies, with trademark dilution you do not have to show any likelihood of confusion over the source or sponsorship of the goods or services.
Trademark Protection Recommendations
Communicate with an attorney experienced in trademark matters to determine whether any critically important trademarks and service marks used by your business are candidates for trademark protection. These might include:
The name of the business.
Names of specific goods and services.
Domain names used by the company.
Sales slogans.
Trade dress of products, packaging, or storefronts, etc.
I. Trade Name
A trade name is a name under which a business operates or identifies itself. It is used to distinguish a business entity from others, but it does not necessarily relate to the source of goods or services, which is the role of a trademark or service mark.
1. South Carolina Trade Name Registration
Under South Carolina law, businesses must register a trade name if they operate under a name other than the legal name of the owner or business entity.
Legal Framework:
South Carolina Code of Laws § 39-15-1020 – Registration of Trade Names. This section mandates that a trade name (also known as a “doing business as” (DBA) name) must be registered with the South Carolina Secretary of State if it differs from the owner’s legal name.
Registration Process:
Search for availability of the trade name using the South Carolina Secretary of State’s business name search tool.
File the registration with the Secretary of State’s office. This can be done online.
Pay the registration fee (typically around $10).
A trade name registration is valid for five years and can be renewed upon expiration.
Protection:
A trade name is protected only within South Carolina and does not offer the same level of exclusivity as a trademark or service mark. It simply serves to identify a business entity in commerce within the state.
2. Federal Considerations:
Trade names are generally not protected under federal law unless they are used as trademarks or service marks. If the trade name is also used to identify the source of goods or services, it may be eligible for federal trademark or service mark protection.
II. Trademark
A trademark is a word, name, symbol, device, or combination thereof that is used to identify and distinguish the goods of one company from those of others. It provides legal protection for brand names, logos, product names, and other identifiers of commercial origin.
1. South Carolina Trademark Protection
In South Carolina, trademarks are registered with the South Carolina Secretary of State’s Office, but only provide protection within the state.
Legal Framework:
South Carolina Code of Laws § 39-15-110 to § 39-15-120 – These sections govern the state registration of trademarks in South Carolina. The process is handled by the Secretary of State’s office.
Registration Process:
Search the South Carolina Secretary of State’s trademark database to ensure the trademark is not already in use.
Submit the registration application, providing details about the trademark and how it is used in commerce.
Pay the registration fee (typically around $15-$25).
A South Carolina trademark registration is valid for five years and can be renewed.
Protection:
South Carolina trademark registration offers state-level protection and prevents others from using the same or confusingly similar mark in South Carolina. However, the protection is limited to the state’s borders.
2. Federal Trademark Protection
Under federal law, trademarks are governed by the Lanham Act (15 U.S.C. §§ 1051–1141n). This law provides national protection for trademarks used in interstate commerce.
Legal Framework:
Lanham Act (15 U.S.C. §§ 1051-1141n) – Governs the federal registration and protection of trademarks.
15 U.S.C. § 1051 – Establishes the procedures for registering a trademark with the United States Patent and Trademark Office (USPTO).
Registration Process:
Conduct a search on the USPTO’s Trademark Electronic Search System (TESS) to check if your mark is available.
File the application via the USPTO’s Trademark Electronic Application System (TEAS).
Submit a specimen showing the mark in use in commerce, and describe the goods or services associated with the mark.
Pay the application fee (generally $250-$350 depending on the filing type).
Once approved, the mark is registered with the USPTO and is valid for ten years, with renewals available.
Protection:
Federal trademark registration offers nationwide protection, making it illegal for others to use a confusingly similar mark in interstate commerce. Additionally, federal registration provides access to federal courts for infringement claims, and other advantages like statutory damages and attorney fees in case of willful infringement.
III. Service Mark
A service mark is similar to a trademark but applies specifically to services, rather than goods. It protects words, names, or symbols used to identify and distinguish the services of one provider from others in the market.
1. South Carolina Service Mark Registration
South Carolina provides the ability to register a service mark with the Secretary of State, similar to how trademarks are registered.
Legal Framework:
South Carolina Code of Laws § 39-15-110 to § 39-15-120 – These sections extend to the registration of service marks in South Carolina.
Registration Process:
Search the Secretary of State’s service mark database for availability.
Submit an application with a description of the services and the mark’s use in commerce.
Pay the registration fee (typically $15-$25).
Once approved, the registration is valid for five years and can be renewed.
Protection:
Like trademarks, state service mark registrations protect service identifiers within South Carolina. This protection is limited to the state level and does not extend to other states.
2. Federal Service Mark Protection
Under federal law, a service mark is protected in the same way as a trademark, and the Lanham Act governs its registration and enforcement.
Legal Framework:
Lanham Act (15 U.S.C. §§ 1051-1141n) – Protects service marks used in interstate commerce.
15 U.S.C. § 1051 – Establishes the procedure for registering service marks with the USPTO.
Registration Process:
Conduct a search on the USPTO’s TESS to check for existing marks.
File an application through the USPTO’s TEAS system, describing the services and providing a specimen of the service mark in use.
Pay the required application fee (typically $250-$350).
Once approved, the service mark is registered and protected for ten years.
Protection:
Federal registration grants exclusive rights to the service mark on a national level, including the ability to enforce the mark against infringers in federal court.
IV. Trade Dress
Trade dress refers to the overall visual appearance of a product or its packaging, or the way a service is presented, that signifies the source of the goods or services. It includes elements like size, shape, color, texture, and layout.
1. South Carolina Trade Dress Protection
Trade dress is generally not specifically addressed in South Carolina law but is still subject to federal protection under the Lanham Act.
2. Federal Trade Dress Protection
Under the Lanham Act (15 U.S.C. § 1125(a)), trade dress is protected if it is distinctive and non-functional. Trade dress protection is available if the appearance of a product or service is capable of identifying the source of the goods or services and is not essential to the use or purpose of the product.
Legal Framework:
15 U.S.C. § 1125(a) – Protects trade dress that causes consumer confusion regarding the source of the goods or services.
Registration Process:
Search
File a trade dress application with the USPTO if the design or packaging is distinctive and used in commerce.
Provide a specimen showing the trade dress in use.
Pay the application fee (typically $250-$350).
If registered, trade dress protection lasts for ten years and is renewable.
Protection:
Federal trade dress protection prevents competitors from copying the overall appearance of a product or service that is recognized by consumers as being associated with a particular source.
V. Enforcement of Rights
1. Infringement and Legal Remedies:
State Enforcement: Under South Carolina law, businesses can enforce their trade name, trademark, service mark, and trade dress rights in state court under claims of **
unfair competition** or misrepresentation.
Federal Enforcement: For federally registered trademarks, service marks, or trade dress, infringement cases are heard in federal courts under the Lanham Act. Infringement of state-level marks can also be enforced in federal court if the mark is registered at the federal level.
Available Remedies:
Injunctions to stop the infringement.
Monetary damages, including actual damages and the infringer’s profits.
Statutory damages for willful infringement under the Lanham Act.
Attorneys’ fees in cases of willful infringement.
2. Cancellation and Disputes:
Petitions for Cancellation: Both state and federal registrations can be contested through a Petition to Cancel filed with the USPTO or relevant state authority.
Conclusion
The distinctions between trade names, trademarks, service marks, and trade dress are important for businesses seeking to protect their brand identity. Each type of intellectual property has its own set of registration processes, protections, and enforcement options, both at the state and federal levels. Registering with the South Carolina Secretary of State provides state-based protection, while federal registration offers nationwide protection through the USPTO.
For comprehensive advice tailored to your business, especially regarding how to file or enforce these rights, consulting with an intellectual property attorney is highly recommended.
References
South Carolina Code of Laws § 39-15-1020, § 39-15-110 to § 39-15-120.
Lanham Act (15 U.S.C. §§ 1051-1141n).
USPTO Website – https://www.uspto.gov/
Prior to using any trademark, perform due diligence to ensure the business does not infringe on the marks of others. Such due diligence might include:
- Online searches
- Review of relevant trade and industry journals
- Employing a law firm or trademark search firm or service
- Employing a trademark watch service or purchase trademark infringement protection software to ensure against others infringing on your trademarks
- Making sure that you own your own logo. Many businesses hire others to create logos to identify the businesses goods and services. Logos that are graphic designs are generally protected by copyright law. Unless the person who created it is you or your employee, you may not actually own the design. Where appropriate, a written work for hire agreement signed by everyone who will participate in the creation of a logo must be signed before any work begins. Otherwise, you may need to obtain a copyright assignment after the fact transferring their copyright in the design to you, including the right to use it as your trademark.
Trademark users have certain protections under common law principles of unfair trade practices. Under common law, the first user of a mark is the owner of it. However, if a second party later uses a confusingly similar mark in a remote geographic area in good faith (with no notice of the earlier use of the other mark that is ongoing in the U.S.) the second party will have superior rights in the mark in that remote geographical area (known as a ‘”good faith defense”).
The area of a party’s actual use of a mark is comprised not just of the area in which the user has sold goods or services through use of the mark. It may also include those areas in which there have been no sales but the mark has a presence by virtue of advertising or general reputation. Common Law Symbols. May use “TM” and “SM” to put world on notice of use of a non-federally registered mark.
Businesses can often satisfy the interstate commerce requirement through out-of-state sales, transactions involving customers engaged in interstate travel, the use of shipping services with hubs outside South Carolina, or by accepting credit card payments.
Registration on the Principle Register of the United States Patent and Trade Mark Office (USPTO). Registration on the Principle Register of the USPTO provides: (1) a right to assistance from U.S. Customs in preventing infringing goods from entering the country; (2) presumptions of mark ownership and validity and, after five years of registration, preclusion of certain challenges or defenses to the
mark; and (3) rights in the mark in a greater geographical area than would be possible under common law.
Be sure to make all periodic filings with the USPTO in the U.S. or elsewhere, as appropriate, or employ an appropriately equipped law firm to do so.